Gold keeps the red amid firmer USD; holds above $3,500 ahead of US data

Gold (XAU/USD) attracts some dip-buyers in the vicinity of the $3,500 psychological mark, though it retains the negative bias through the first half of the European session on Thursday. Worries about rising debt levels across major economies, fueled by a surge in global bond yields this week, now seem to have subsided. This is evident from a sense of calm around the financial markets and prompts some profit-taking around the safe-haven commodity amid overbought conditions.

Apart from this, a modest US Dollar (USD) turned out to be another factor that weighed on the Gold price and contributed to the heavy intraday losses. However, the growing acceptance that the US Federal Reserve (Fed) will cut interest rates later this month keeps a lid on any meaningful USD appreciation and offers some support to the non-yielding yellow metal. Traders also seem reluctant to place aggressive bets ahead of the release of the US Nonfarm Payrolls (NFP) report on Friday.

Daily Digest Market Movers: Gold bears seem non-committed amid supportive fundamental backdrop

• Demand for traditional safe-haven assets recedes amid signs of stability in the fixed-income and equity markets, which is seen undermining the Gold price on Thursday. Furthermore, a modest US Dollar (USD) uptick drags the commodity away from the record high amid overbought conditions on short-term charts, following the relentless rally over the past two weeks or so.
• Any meaningful USD appreciation, however, seems elusive in the wake of expectations that the US Federal Reserve will resume its rate-cutting cycle this month. The bets were reaffirmed by Wednesday's US JOLTS report, showing that the number of job openings stood at 7.18 million in July compared to the previous month's downwardly revised reading of 7.35 million.
• On the trade-related front, US President Trump on Tuesday said his administration would seek an immediate hearing from the Supreme Court in hopes of overturning a federal appeals court's ruling deeming most of his tariffs illegal. This adds a layer of uncertainty in the markets, which could offer some support to the XAU/USD pair and help limit any meaningful decline.
• Traders now look forward to Thursday's US economic docket – featuring the ADP report on private-sector employment, the usual Weekly Initial Jobless Claims, and ISM Services PMI. The market focus, however, will remain glued to the release of the official monthly employment details – popularly known as the Nonfarm Payrolls (NFP) report for August on Friday.
• The crucial data will play a key role in influencing market expectations about the Fed's rate-cut path, which, in turn, will drive the USD demand in the near term and provide a fresh directional impetus to the commodity. In the meantime, the supportive fundamental backdrop backs the case for the emergence of some dip-buying and warrants caution for the XAU/USD bears.

Gold shows some resilience near 23.6% Fibo. level and bounces off $3,500 neighborhood

From a technical perspective, the intraday corrective pullback finds some support near the 23.6% Fibonacci retracement level of the recent rally from the vicinity of the $3,300 mark, or the 100-day Simple Moving Average (SMA) pivotal support. Some follow-through selling, leading to a subsequent break below the $3,500 psychological mark, could pave the way for a deeper corrective pullback towards the $3,440 region. The latter represents a multi-month-old trading range hurdle, which, if broken, will suggest that the Gold price has topped out and shift the near-term bias in favor of bearish traders.

On the flip side, the $3.560 area could offer some resistance ahead of the $3,578-3,579 region, or the all-time peak touched on Wednesday. The Gold price could extend the momentum further in the uncharted territory and aim towards conquering the $3,600 mark, or the trading range breakout target.